PayPal International Fees Uncovered - 4 Must Know Fees
PayPal fees can be incredibly high to send money abroad. While PayPal is provides a useful personal account for shopping online and keeping a PayPal balance, it's hard to compare PayPal fees to alternative services that offer international transactions, due to the higher fees PayPal charges for sending money abroad.
This article will uncover all the costs to transfer money internationally, and help you decide if using your PayPal account is the best way to go.
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What Are PayPal's International Fees to transfer money & How to Avoid Them?
Recommended Alternatives to PayPal to send money overseas
What Are PayPal's International Fees to transfer money & How to Avoid Them?
PayPal is an easy, but expensive way to send international transfers to business partners, friends, and family residing in countries abroad. While the PayPal app is easy to use, international money transfers via the app are much more expensive than other money transfer providers.
Today, customers have more international money transfer options for paying foreign partners than ever.
A key development has been the establishment of money transfer services that enable online money transfers.
Why are these fees important to know?
Transfer fees are everywhere when using PayPal for international transfers. From exchange rate conversion fees, to additional charges for the use of a debit card, you'll find the charges add up when the money is sent through a PayPal account. A PayPal transfer may be easier and less expensive than a bank transfer, where a wire is sent, but the transaction fee structure is generally unfavourable, and fees vary based on many factors, making the process confusing. Hopefully, these confusing fees for international transfers will encourage you to be careful about selecting the right money transfer service to transfer money overseas.
Currency conversion fee
The main cost to consider when sending money to a PayPal account abroad is the currency conversion rate. Unlike many other modern providers, PayPal exchange rate is not quoted at the mid- market exchange rate, meaning you'll pay a higher price due to a worse exchange rate.
Compared to the current exchange rate to convert two currencies, the PayPal fee or conversion rate is about 5% worse depending on the country you are sending it from and the destination you are sending it to. It's the same process employed by many banks and financial institutions, and is not as modern as many other providers who make the currency conversion involved more transparent.
PayPal exchange rate
When you want to send money internationally Paypal allows you to select the currency using your PayPal account. If the payment is sent from another bank to your PayPal account, it'll be done by converting the currency within your PayPal account. PayPal's exchange rate includes a strong mark-up – a hidden and additional charge. During research for transfers from British pounds to euros, PayPal’s exchange rate was for instance more than 4% worse than the real mid-market exchange rate. 4% may not seem much, but these fees add up quickly and is typical for international banking.
PayPal international transfer fees
PayPal can also charge fixed fees per international transfer, typically of between 0.99 and 3 British pounds in addition. But this depends on the currency pair, your account and the pay-in method.
Card Fees
A card funding fee may also apply on deposits when you want to send money abroad if you don't have money in your PayPal balance.
How long does a PayPal international money transfer take?
When a recipient asks when they will receive money into their PayPal account, it's usually credited directly to the account. Alternatively, if your recipients aim to deposit the foreign currency into their linked bank account then they may wait a couple of days, depending on where they are located and the location of the bank. What PayPal writes about delivery times:
PayPal: Instant deposits to recipient’s PayPal account — withdrawals to a bank can take some time depending on the country of the recipient.
PayPal international money transfer comparison
Compared to other providers, PayPal ranks worse than almost all of them, for most transfers, on a transfer fee comparison. We recommend researching the providers below, before using your PayPal account to transfer money.
Recommended Alternatives to PayPal to send money overseas
Atlantic Money
Atlantic Money is the best money transfer provider for larger international transfer cases, typically above 1000 GBP/EUR. The service offers currency conversion at the mid-market rate (the gold standard in exchange rates), and charges a flat fee of 3 GBP/EUR. If you are sending a larger international transfer from your UK bank account or EU linked bank account, it's worth considering as an option. All the fees are included in the 3 EUR/GBP cost, and all you need to get started is the recipient's bank account information.
You can also use Atlantic money as an option to send money from the UK to USA.
Wise (TransferWise)
Wise is one of the money transfer services which supports a large variety of payment types, currency corridors, and also charges the mid-market exchange rate, so there are no hidden fees in the currency conversion spread. But as they take a percentage of your transfer, you pay more the more you send, and transfer fees do increase on a larger international transfer. Wise has a strong policy to always disclose all the costs involved sending money internationally and supports both personal payments as well as business payments. Like PayPal, Wise also offers multi-currency accounts, and improves on the concept by not forcing you to hold another currency than you want.
Revolut
Revolut is a money transfer service and multi currency account that many people prefer in sending money abroad. Especially smaller payment amounts. Revolut is generally transparent about its currency conversion fees, both for sending money abroad, as well as spending foreign currency via its debit card. Revolut is usually getting quite expensive for larger transactions when sending money internationally, as their currency conversion fees kick in at higher transaction amounts. They do however have a maximum fee and minimum fee structure for certain types of transactions.
Send money internationally with your bank account
An alternative to PayPal to transfer money internationally to friends and family, is with your existing bank account using a wire transfer. Using Wire transfers has both advantages and disadvantages, similar to PayPal, including possibly being charge a worse exchange rate conversion fee, and a fixed fee, typically called a wire fee.
Besides being a familiar option, you may have more ease in utilizing their bank accounts. This type of transfer requires a recipient's bank details, since you won't be able to send it to their app or digital wallet. You may also have higher processing times and higher fees related to the transfer, depending on your bank.
Transfer limits and available countries
Your PayPal credit cards may limit how much cash you have to send them and the type your account is. Unverified accounts can have maximum payments of up to 1,000 GBP and receive maximum 1,900 GBP per annum. If the account is verified and the limit is lifted, users can send between 10,000 and 60,000 GBP. PayPal international payments can take place for PayPal customers in many currencies and countries. Check out your account and check the available country for the account types in which the account has been set up.
Can I use PayPal to send money internationally?
Yes, it is possible to pay via PayPal in international currencies. This service can handle international money transfers to more than 200 countries and regions in just several days. If you use PayPal to send money abroad, you'd better know what fees are attached to such transactions. This page covers the fees for sending money through an international PayPal account. This is important to note because prices may vary depending on the location of the transfer.
Pros and cons of transferring money abroad with a PayPal account
Pros: It's very simple. If someone uses a PayPal account, just enter his or her e-mail and send the money – a huge chance to immediately deposit a check for the recipient.
Con: Exchange rates are marked up and make the transaction super costly. On top, additional fees might be charged.
Generally, international payments will be cheaper and you will get a better price when you use the specialist service rather than the usual service.
Can PayPal be used for international transactions?
PayPal offers customers the choice of making international transactions via PayPal's app or online payment system. However, it may differ slightly if both senders have their own PayPal accounts. When both the customers have PayPal accounts, the transaction may take place using PayPal. Unless a recipient is not registered to a PayPal account, it is possible that Xoom is a third-party payment system which is owned and operated by PayPal.
Paypal Fees for International money transfers by Country
UK
PayPal’s fees in the UK vary in two ways. The international fees for sending the mail are: (1) A fee for sending international personal transactions (5% of the amount up to 2.99 GBP) and (2) a markup on the exchange rate which is about 5% of the total amount without a limit. Also note and review that some charges are paid by senders while others are paid by receivers.
Fees for receiving money into the UK
Payment in GBP is free. In return, receiving another currency will incur an exchange rate that is not to your benefit. However, there are some costs associated with currency trading if someone sends you this money. Savings tip: In practical circumstances, ask the sender for the conversion. Alternatively, it's easy to keep balance on a currency you send to yourself to pay in another currency (which saves the conversion fee twice). Often, people use currency such as USD.
Currency conversion
The fees you pay via PayPal vary according to the currency you choose to change but they are around 5% of the total amount sent which is expensive. To be sure compare PayPal’s rate with mid-market rate you find in currency converter tools.
International fee (Sending from UK)
5% of transactions are made from 0.99 GBP to 2.99 GBP (which is currently £60).
USA
I the US PayPal charges 3 different fees. A few are credited with sending – others with receiving. (1) Fee for the payment type, depending on the chosen option. (2) Currency exchange fee for converting your currency in another currency. (3) Fixed fee based on the received currency.
Sending fee for different accounts
If you send money with PayPal from the USA to another currency, they always charge you a fee of 5% and maximum 4.99 USD for your payment method. There is no difference if you use your PayPal balance, bank account, a credit card or Amex Send – you will always pay up to 4.99 USD.
PayPal’s conversion fee
PayPal charges two different percentage fees in the US for converting a currency. If the payment is for goods and service, for family and friends or PayPal Payouts the percentage is about 4%. In all other transactions the fee is about 3% of the total amount sent.
Receiving international transfers
The fee for receiving another currency than US-Dollar differs for each currency, but is therefore fixed and has to be paid by the recipient. PayPal shows the exact fee of each currency on their website
Australia
As in the US, PayPal imposes three distinct fees for users in Australia: (1) a fee for the chosen payment method, (2) a currency exchange fee for converting to another currency, (3) and a fixed fee based on the received currency.
Fees for the funding source
No matter what payment method you use – PayPal balance, AU bank account, or different credit card – when you send money with PayPal from Australia to a different currency, you'll always be charged a fee of minimum 0.99 AUD and maximum of 5.99 AUD. These costs are calculated by a percentage fee of 5%. In the case of credit cards, additional fees may be added, whereby the maximum value is reached more quickly.
Currency conversion
PayPal states a currency conversion fee of 4% of the total amount when sending AUD to a different currency. Means, their exchange rate will be 4% worse than the real and so-called mid-market rate.
Fees for receiving a different currency
If you receive a currency other than Australian dollars through PayPal, you will have to pay a fixed fee for that. The fee varies depending on the received currency, and can be found on PayPal’s website.
Canada
In Canada PayPal also charges the three different fees for the the chosen payment method, the currency exchange and for receiving a currency.
Fees for sending money internationally
The fees for a single international transaction in Canada differ quite a bit at PayPal. Users who use their PayPal account balance or bank account will pay a fixed fee of 2.99 CAD – if the recipient’s account is in Europe or the United States. In any other regions the fee will be 4.99 CAD.
Users who use their card to send the money have to pay the same fixed fee of 2.99 or 4.99 CAD depending on the region but also an additional charge of 2.99%.
Converting payments
PayPal charges a 4% currency conversion fee when sending/receiving personal payments, commercial transactions and when using PayPal Payouts. It’s 3% for all other cases.
Fee for receiving transactions
Users from Canada to pay a fixed if they receive a currency other than Canadian dollars through PayPal. The fee can be found on the website of PayPal.
